European Central Bank raises rates by another 0.25 %

As widely expected the European Central Bank raised rates by another 0.25 % today.

The press conference coming up in 10 minutes will hopefully be very interesting.

Cue Comical Austin…

Looks like the only way is up based on the commentry of the news conference.

Trichet says he is not saying that rates are now at a peak.

Laugh up the ECB rate with Comical Austin!!! :smiley:

JCT said that rates were still on the ‘accomodative’ side - therefore we can be pretty certain of an increase in June/July and at the moment a still greater than average chance of a second rise in September

Actually, I might put the dates of the rate rises on the back!!!

Sorta like a concert tour schedule… :stuck_out_tongue:

The indo was still at again this morning, telling us this hike could be the last

*Falling stock markets have reduced the chances of another rate rise in June, according to traders and investors are now putting less than a 50-50 bet on a mid-summer increase in European Central Bank rates to 4pc. *

He also said “monitor very closely” as well as accomodative. He seems happy with the markets expectations of at least 4% by year end and maybe even 4.25.

This is a further reminder to those eeking out 3% less maintenance that
they’re in trouble! Their cost of capital will be at least 5% by year end.

Yeah heard that Indo nonsense. In Frankfurt and everywhere else they’re talking about whether or not there will be two further increases rather than just one more but here in Ireland (where it really matters of course) we have our own pixie ideas!


From the Irish Times:

**Labour Finance spokeswoman Joan Burton called on the ECB to explain why it has opted for seven successive rate hikes. **

European inflation has remained at 1.8 per cent in both January and February, which is below the target set by the European Central Bank," she said.

"Today’s interest rate increase will hit many Irish families hard, particularly those at the lower end of the market who were barely able to get approval for an affordable home and people with high levels of debt, particularly credit card debt.

Ms Bruton said that small Irish businesses would also be hit by the rate hikes, coupled with the “excessive profit margin” that banks charged on a lot of their lending to small business.

Labour Seanad Finance Spokesperson Derek McDowell accused the ECB of wanting to “squeeze the life” out of the European economy and Irish mortgage holders.

“By fuelling expectations that interest rates will continue to rise by as much as three quarters of a point this year alone, the ECB is creating the kind of uncertainty in the market that will turn a soft landing into a hard fall.”

Fine Gael environment spokesman Fergus O’Dowd used the news of the hike to call for stamp duty reform.

“There is no doubt that the pain caused by this rate hike would have been alleviated by reforming stamp duty but Fianna Fáil and the PDs refused to grab that golden opportunity in the Budget,” he said.

Mr Trichet, are you listening to Mrs Bruton and Mr McDowell???

Thats where people will get caught, in my area you pay 300K for a house then you then need to lump on another 50K for stamp duty, fitting out, legal fees etc., so you owe 350K on your investment property and your repayments are €17500(5%) on an interest only mortgage, on top of this you have insurance and related maintenance costs. The houses are making €800 a month in rent and say you get it for 10 months, thats €8K, lets allow €1000 for insurance and maintence etc. you are subsidising the tenant by 10K per annum, you can get 4% for this if its left in the bank.

Only a fool would invest in a house now, there will be no capital appreciation for at least a few years and prices will fall if anything.

In the current market the only people who should be looking to buy houses are those who want their own home to live in and even at that they should be chasing bargains.

These people are so retarded, the whole idea of spelling out future direction in rates policy is so that the markets are prepared and there are no shocks which cause a crash (or hard landing).

softlanding my hole, was never gonna happen in house price pyramid scheme Ireland.

Plaudit-couldn’t agree more. The rest of us, markets and all can see what Trichet is saying about future interest rates and they, the Governing Council, deliberately do it this way so as to avoid shocks, etc - what a bunch of intellectually challenged twits?

People could have fixed their rates over the years if they could not handle the risk of big hikes, nobodys fault but their own.

Why should he. After all NOBODY here was listening to him last summer.

Flash - ever heard of sarcasm?

Yes. I understand irony too.